team

Executive Summary Comment by Leigh A. Ruggiero: https://www.newcastle.edu.au/__data/assets/pdf_file/0009/497799/Reports-Executive-summary-_Bus_.pdf •purpose •problem •methods of analyzing the problem •results of analysis •recommendations

Starbucks Corporation was established by Gordon Bowker, Jerry Baldwin, and Zev Siegl, who were inexperienced businessmen. The corporation in Seattle that was created in 1971 focused on selling coffee beans, teas, and brewing tools like grinders and teapots, unlike the current stores. The reports provide the historical background of Starbucks, a review of its mission, vision, values, and goals which informs the guiding principles of the organization. The organization’s key fact is also described in the paper such the CEO if the corporation, its size and general purpose of the company. The paper will also look at the organization’s strategy and objectives and their influence for performance. The strategies that Starbucks corporation have settled for involves Firstly, they involve market penetration, which supports the organization's intensive Growth by integrating revenues from existing markets and applying the same food and beverage products. Secondly, Starbucks uses Market Development as it is a secondary strategy for intensive Growth. The technique supports the business development by creating revenues in new markets by providing Starbucks' current product mix of food and beverages. Thirdly, Product Development is another intensive growth strategy that informs Starbuck's development via new products or variants that contribute to business revenues. The competitive advantage of the company will be explored and critical analysis of the resources such human and technological resources. The report also examines leadership, governance and management of the corporation. Evaluation of strengths and weakness, the capacity for learning and change and the recommendations for the firm. Comment by Leigh A. Ruggiero: What in this list is unlike the current stores? How has the focus shifted? Comment by Leigh A. Ruggiero: This report provides Comment by Leigh A. Ruggiero: This sentence doesn’t seem necessary. Comment by Leigh A. Ruggiero: cover page—not included in page limit executive summary—1 page; not included in page limit introduction—1 page fact sheet—1 page; see Step 2 mission, vision, values and goals—1 page; see Step 3 stragegy and objectives—1 page; see Step 4 strategy types and competitive advantage—2 to 3 pages; see Step 5 organizational size and structure—2 to 3 pages; see Step 6 critical resources—2 to 3 pages; see Step 7 leadership, governance, and management—2 to 3 pages; see Step 8 strengths and weaknesses—1 to 2 pages; see Step 9 learning and change—1 to 2 pages; see Step 10 conclusions and recommendations—1 page; see Step 11 references—not included in page limit addenda—if needed, is not included in page limit submit—see Step 12 Comment by Leigh A. Ruggiero: An executive summary usually ends with a bulleted list of recommendations.

Based on this situation audit, Starbucks should do the following:

· Recommendation 1

· Recommendation 2

· Recommendation 3

The report presents the results of a situation audit of the Starbucks organization. The situation audit exhibits a review of organizational mission, vision, and guiding principles. Also, the strategies, objectives, and competitive advantage Starbucks. It is crucial to acknowledge that Starbucks company is an international coffee brand that is extending its operations. There are several challenges to this level of Growth, and the organization needs to take great care in the distinction of how stores are built in the United States and across the globe. The organization should assess various strategic options to develop brand longevity. An effective strategy can be selected relying on a situational analysis, financial analysis, and organizational objectives. After a final strategic recommendation has been made, a contingency plan will be developed to ensure long-term success. Comment by Leigh A. Ruggiero: “Growth” shouldn’t be capitalized.

Fact Sheet

Starbucks’ initial store was developed in Seattle, Washington, in 1971, as ascertained by Starbucks Corporation (2019). According to Farr (2019), Starbucks was established by Gordon Bowker, Jerry Baldwin, and. Zev Siegl, who were inexperienced businessmen. They met again earlier in their lives, where they met in Seattle, and they agreed on starting a coffee organization. The corporation in Seattle that was created in 1971 focused on selling coffee beans, teas, and brewing tools like grinders and teapots, unlike the current stores. They experienced low net income in their initial years, which triggered Baldwin and Siegl to open another branch in their second year of business, as Farr (2017) stipulated. The partners decided to roast their coffee beans and lease a building for their roasting plant. From this point, it was evident that Starbucks had started to grow gradually, although it faced numerous challenges from increased coffee beans due to issues experienced in Brazil.

The challenges led to the loss of a founding business partner to open another coffee store in 1984 after overcoming the previous challenges they encountered. Howard Schultz, the manager of retail operations and marketing, was forced to establish a new firm, 11 Giornale, which focused on selling coffee beverages brewed from the organization (Starbucks Corporation 2019). More than three decades later, Starbucks has continuously progressed its commitment to "inspire and nurture the human spirit, one person, one cup, and one neighborhood at a time" (Starbucks Corporation 2019). Having grown exponentially since its inception, Starbucks now operates more than 30,000 stores in 78 markets and earns over $24 billion in revenue, as confirmed by Starbucks Corporation (2019). Starbucks strives to provide the best coffee possible, most ethically, from coffee bean growth to store service and corporate practices. Comment by Leigh A. Ruggiero: Starbucks is a member of the UN Global Compact, a global network of companies that support ten universal principles. The corporation signed as a member in June 2004 as an extension of its mission statement that defines Starbuck's commitment to social and environmental responsibility. Being a member of the UN Global Compact has enabled the firm to promote existing or establish unique internal practices and regulations. The ten principles include Human Rights. Starbucks is supposed to support and respect the protection of internally implemented rights such as Business Ethics and Compliance Policy, Global Human Rights for coffee and cocoa (Starbucks Corporation 2019). The second principle involves the firm ensuring they are not complicit in human rights abuses, and for Starbucks, it consists of labor standards like eliminating forced or compulsory labor. It also includes protection of the environment and not entertaining corruption in the company. Starbucks has been associated with tax avoidance for several years now. In 2012, Starbucks in the United Kingdom experienced a public relations furor concerning its inability to pay British corporate income taxes. Starbucks ' tax avoidance practices were regular among multinational corporations. Still, Starbucks had been clear concerning its public commitment to being socially responsible and a responsible citizen of the society that it functioned. This also entails paying other aspects like fair wages to the workers and paying fair wages to coffee farmers in developing nations. Starbucks operates, and its competition is in the retail coffee and snacks store industry (Starbucks Corporation, 2021). So, the organization is under the beverage industry, whereby it sells beverages, food, and other items in 83 global markets. Starbucks gains significant sales from beverages from America's segment entailing the US, Canada, and Latin America. The firm functions with its subsidiaries as a roaster, marketer, and retailer of specialty coffee across the globe. The organization functions via three fragments such as Americas, International, and Channel development. Its stores provide coffee and tea beverages, roasted beans including ground coffees, single-serve, ready-to-drink drinks, iced tea, and many food products like pastries, breakfast sandwiches, and lunch items. Starbucks corporation licensed its trademarks via licensed stores and groceries, and foodservice accounts. The firms provide their products under Starbucks, Teavana, Seattle's Best Coffee, Evolution Fresh, Ethos, Starbucks Reserve, and Princi brand names. According to the firm's report on October 29, 2020, it functions in approximately 32,000 stores. Its corporation's ISS. The governance Quality Score as of September 26, 2021, is 6. The pillar score includes 9; Board;1; Shareholder Rights; 2; Compensation; 9.

The current CEO of Starbucks is Kevin Johnson, who is also the corporation’s chief operating officer, guiding the firm's global operational business across America. He is a passionate leader who carries on the legacy of Starbucks, driving the firm's core strategies for development and being of service to more than 400,000 shareholders who wear the green apron across the world. The CEO joined the corporation in 2009, but in March 2015, he assumed the role of president and the chief operating officer leading the organization's worldwide operating businesses in all geographical locations. Kevin Johnson also effectively supports Starbucks supply chain sector, marketing, human resources, technology, and mobile, including digital platforms.

Mission, Vision, Values, & Goals

Starbucks’ (year ) Vision Statement is "To establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow." This statement’s main components are Premier purveyance, Finest coffee globally, Uncompromising principles, and Growth. Starbucks coffee's vision is concise, clear, and inspiring to gain and control the premier status in the coffeehouse and coffee industry. It stresses leadership as a key motivator that challenges management and other members of the organization's human resources. Starbucks’ vision is stable due to its applicability to future business events at Starbucks. For example, the premier purveyor element is designed to remain applicable for long-term purposes. Comment by Leigh A. Ruggiero: Replace this

Starbucks’ values entail creating a culture of inclusion. The corporation values diversity and equity by promoting a culture of warmth and belonging to ensure every individual feels welcomed. The second vital value of the company involves acting with courage, and the value has made the firm find numerous ways to grow by changing its status quo through its expansion in China. The third value Starbucks observes involves being present, which entails the organization's transparency, social dignity, including environmental issues. The fourth value involves delivering its best by advancing and devising new technologies and practices to enhance its coffee, consumer experiences, and services. Comment by Leigh A. Ruggiero: The corporation has developed many regulations and strategies to generate a culture of inclusion by spending over $1.5million in the disadvantaged society to enhance their values. Comment by Leigh A. Ruggiero: The corporation has also extended its operations in Jiangsu Province. It will provide the consumers with unique technology for roasting coffee beans that can decrease carbon emissions by more than 30%. Comment by Leigh A. Ruggiero: Starbucks is an ambitious firm that has focused on the most crucial sustainable goal for 2030 for developing unique ways of operating, investment of resources, and urgent actions. Comment by Leigh A. Ruggiero: Starbucks has recently established Microsoft's blockchain-based technology that will make consumers experience an exciting journey to the source of their coffee and where their beans will get roasted which will bring the consumers closer to their beloved beverage.

Strategy and Objectives

According to Starbucks Corporation Report entails the utilization of the critical analytical strategic frameworks in business studies like PEST, Porter's Five Forces, Life—cycle position, Value Chain Analysis, and McKinsey 7S Model on Starbucks. The Starbucks business strategy relies on the following pillars. Firstly, providing third-place experience away from home and work where individuals can spend time in a relaxed and conducive environment, either alone or with friends (Tim, 2021). The consumers are allowed to get their work done at Starbucks stores since most of the stores have free wi-fi. The stores are organized to make the customers stay longer, buy more, and return for more due to its effective services. Secondly, on selling coffee of high quality and its products are distinct for their uniqueness.

The coffee chain giant focuses on the quality of its products, and consumers pay premium prices for high quality. Its effective services as one of the reliable sources of the company's competitive advantages, which also enhances the attractiveness of the coffee retailer. Thirdly, relying on the international market expansion with the focus on emerging economies is one of the vital components of Starbuck's business strategy from a long-term perspective. For instance, the share of the company's revenue from the China/Asia Pacific (CAP) universal market segment increased to 14% in 2016 from 7% in 2015. It resulted in 2719 new Starbucks stores opened from 2016-2018.

The strategies are also based on fourthly, Combining technology into various business processes. The corporation stresses that the new technology promotes its website by making the payment process faster for waiting in line. The coffee chain gains technology-connected value addition through combining technology in a massive range of business procedures, like a new product implementation, communication of the marketing message, competing sales, and regulating the levels of consumer satisfaction. Such as the launch of the mobile order & pay feature permits consumers to purchase without getting in line, the launch of the voice ordering app, and sending text message notifications to consumers in the Seattle area when their mobile orders are ready.

Starbucks is currently focused on promoting Growth and maintaining its image for ethical practices and quality coffee. Therefore, it is crucial to establish the feasibility of these goals and the best strategy for the organization as it progresses. That is why the examination of the situation analysis is vital. For the External Environment, it would be necessary to assess the best strategy for Starbucks Corporation, comprehend its contemporary objective, and determine if they are conducive to developing profit and overall success. Including an examination of the industry, the economic climate, and even the general market to be evaluated.

Political, economic, social, and technological elements can break the general environment and market conditions.

As a global firm, Starbucks is subject to the laws and regulations of every nation in which it operates its business, for it must consider the stability of governments, taxes, and labor procedures. Many Starbucks' 29,000 locations are in the United States, which contains stable government and labor practices. Yet, alterations in taxation, like the Tax Cuts and Jobs Act of 2017, decreased the firm's tax rates from 35%- 21%, as ascertained by Peterson (2017). Starbucks stores 78 markets, including Egypt, Lebanon, and Mexico (Starbucks Corporation, 2019). These nations have ongoing political-related challenges like recovery from civil war and high levels of criminal violence due to drug trafficking. The situations can inform whether Starbucks will continue to function in such nations or not.

Starbucks gives less relevant products, which is why the economic environment is specifically vital to the firm. Since the bulk of Starbucks stores are in the United States, the economic climate in the US is an essential driver of revenues. The economy is stable and expected to continue with GDP slowing slightly from 2018 to 2021 but staying close to the ideal range of 2-3 percent. In addition, the unemployment rate is expected to remain at 3.9%, which is below the Federal Reserve's target unemployment rate (Peterson, 2019). These aspects exhibit that the United States will progress as to a stable revenue source for Starbucks.

There is an extensive demand for ethically generated products, including a focus on corporate responsibility. The customers do not want to support discriminatory firms, destroy local culture, or mistreat the staff. Environmental influence is a crucial matter relevant to modern customers, and the corporates that are environmentally irresponsible or have a large carbon footprint have faced backlash from the public. It is also vital is to note that the millennial consumers, a group that heavily frequents Starbucks, is customization. Customers want to modify products to fit their individual needs, and it is one of the significant goals that Starbucks has ensured it provides its people.

In this era where technology is perceived as fundamental, it is vital for Starbucks' performance, productivity, and general success. Incorporating mobile ordering, mobile apps, and in-store ordering kiosks are all at the forefront of tech in the food industry. There is a rising trend towards enhancing customer experiences, and companies such as McDonald's have developed ordering kiosks instead of having traditional cashiers. In the coffee industry, technology is increasingly vital for speed and customization for Starbucks corporation. And that is why the firm has also introduced mobile ordering and other technological tools for selecting and roasting coffee beans.

Starbucks experiences stiff competition from national chains, including the local coffee stores. The industry can be easily accessed, as renting a storefront and equipment is not quite expensive. Still, there is a concern in managing the resources of established coffee houses such as Starbucks. The threat of new national entrants is minor, six as there are few chains focused, particularly on coffee. These conditions make the threat of new entrants a moderate challenge.

Starbucks provides quality coffees and teas, yet many options exist. Competing national chains such as Dunkin Donuts and McDonald’s have developed into giving their consumers affordable coffee drinks (Taylor, 2017). Conversely, many at-home options such as Nespresso and Keurig cost-effectively generate a high-quality beverage. On the other hand, Starbucks has tried to provide unique services by selling bottled drinks, boxes of Teavana teas, and bags of its coffee beans, including equipment for brewing drinks, like the Verismo Brewer and Milk Frother (Starbucks, 2019). But these products can still be replaced by other brands.

Starbucks works with roughly 300,000 coffee bean growers worldwide (Sargent, 2018) due to its size. The extensive network is a result of its commitment to applying only Fair Trade and sustainably grown products. Although the different suppliers keep bargaining power low, Starbucks can influence their supply orders to other growers if they price their product higher than Starbucks ' initial budget.

Starbucks presents itself as an affordable luxury, but it is still a luxury. The customers are not compelled to spend their money on coffee, giving them the authority to stop purchasing Starbucks' products. Also, there is no cost to consumers for choosing an alternative, which provides them with high bargaining power. Without consumers, Starbucks would not be able to exist.

Integrating the effects of the other four forces, the threat of competitive rivalry is a moderate to high challenge. The threat of substitution is a specific concern, as it comes from other coffee chains and at-home products. The high bargaining power of buyers and the moderate threat of new entrants to maintain the environment as competitive as there are many chances for customers to stop using Starbucks and smaller coffee shops to eat away at Starbucks' significant market share.

Following the porter model of value chain analysis, we will focus on the five primary events: inbound logistics, operations, outbound logistics, marketing, and sales, including service. Starbucks has involved itself with numerous activities in its business framework, starting from its procurement of coffee beans to the distribution of its products.

Source: EdrawMax Online

Figure 1: Value chain analysis

It entails the organization-appointed coffee buyers choosing the best quality coffee beans from the suppliers in Latin America, Africa, and Asia, which usually involve mostly unroasted coffee. Where they get transferred to the storage section for the beans to get roasted and packaged. The value gets added to the beans via Starbucks proprietary roasting and packaging, which helps to promote their selling value. And then sent to the distribution centers, a few of which Starbucks own while the logistics firms manage others. Starbucks depends on its native growers and does not involve third-party procurement, which ensures there are high-quality standards right commencing from the selection point of the coffee beans.

The firm operates in more than eighty markets directly and through licensed stores. Therefore, it means Starbucks does not have a franchise structure compared to the regular beverage stores and fast-food stores. Since the organization owns more than 32,000 stores across the globe and other brands like Teavana, Seattle's Best Coffee, including Evolution Fresh. The fiscal financial reports claimed that Starbucks generates 81% of its revenue from the owned stores and 11% from the licensed stores.

Starbucks does not have a progressing B2B blueprint where brands distribute their products and franchises since its significant products are sold within the stores. Although, the storage and distribution to retail locations are substantial. However, a while back, Starbucks had implemented options to sell-origin coffee beans in the United States. Besides the beverages, consumers could get snacks and baking items, including mugs and tumblers.

Starbucks corporation puts its energy by investing in the finest quality products and a high level of customer service rather than aggressive marketing. The corporation stresses maintaining the best standard for the consumers to get satisfied in sales (Peterson, 2017). Starbucks also has an authentic online presence on numerous social media platforms apart from ground marketing. The firm usually does marketing activities during the launch of new products, new establishments, and other vital activities.

a. Service: The firm strives at developing customer loyalty via its in-store customer service. And one of their significant goals involves providing the customers with unique experiences.

The value of the chain of Starbucks can also be evaluated through the support activities such as the infrastructure whereby the organization has operated for more than four decades, giving it the most substantial infrastructure in sectors like finance, management, marketing, and other relevant departments. The main office is in Seattle and others across the globe, and another support event includes Human resource management. The firm has more than 350,000 workers universally that consists of baristas, brewing staff, corporate workers, and other crucial teams to make operations run smoothly.

The research done by Hewitt Associates stated that Starbucks has a worker satisfaction rate of 82%, which leads to the food and service industry. Technology Development is prevalent in the firm for it utilizes the best-in-class measures to make the procedure of selecting coffee beans and brewing beverages in distinct locations (Peterson, 2017). Moreover, the company stores give facilities like high-speed wi-fi that helps the consumers to get their work done from the coffee shops. It also has an outstanding reward program that enables customers to place orders from its connected stores through various food delivery applications. The procurement comes from the in-house sources since it does not purchase its coffee beans from the third-party sources staring from the production of the coffee beans to packaging; all the procedure is usually done within.

The strategy helps Starbucks organization evaluate its performance through the seven vital elements of the organization, such as the structure, systems, strategy, skills, staff, styles, and shared values, as illustrated in the diagram below. They can be categorized as hard and soft elements.

Figure 2: Hard and Soft Elements of the model McKinsey 7S

Figure 3: McKinsey 7S Model

Strategy

Starbucks Corporation's strategy relies on product differentiation with the stress on the quality of the products and services. The coffee chain giant has organized Starbucks stores as a third place away from home and works so that the consumers can interact with friends, relatives or enjoy alone company (Taylor, 2017). There is the utilization of technological advances in all the services offered in their stores, making it a crucial strategy for Starbucks. Such as the implementation of mobile order &Pay feature for which permits the consumers to without queuing.

The organization has its structure in divisions, and it combines geographic and brand-based divisions. For instance, the coffee chain giant's geographic divisions entail the Americas, Canada, the US, and Latin America. Also, Europe, Middle East, and Africa (EMEA), China, and

Asia/Pacific (CAP) channel development, including other fragments. Similarly, the brand-based divisions of the organization entail Starbucks, Teavana, La Boulange, Evolution Fresh, Seattle's Best Coffee, and Tazo Tea brands (Taylor, 2017). Starbucks arrangement is tall and entails 35 senior vice presidents, 12 executive vice presidents, three presidents, and 2 group presidents.

There is a massive range of systems that inform the daily business of the world's largest coffee retailer. They involve but are not limited to staff recruitment and selection systems, transaction processing systems, customer relationship management systems. Also, the business intelligence process, knowledge management system, and other crucial systems facilitate the daily operations of Starbucks (Taylor, 2017). The company has successfully combined a mobile ordering system. More than 9% of the orders are transacted through mobile phone, which gives hope that the system will work more effectively for many customers in the future.

Starbucks Corporation has utilized multiple strategies for effective business development that have been classified as intensive growth strategies. Firstly, they involve market penetration, which supports the organization's intensive Growth by integrating revenues from existing markets and applying the same food and beverage products. Secondly, Starbucks uses Market Development as it is a secondary strategy for intensive Growth. The technique supports the business development by creating revenues in new markets by providing Starbucks' current product mix of food and beverages (edrawmax.com 2021). For instance, Starbucks coffee provides its existing products to more consumers by going to many nations like Africa and the Middle East. Thirdly, Product Development is another intensive growth strategy that informs Starbuck's development via new products or variants that contribute to business revenues.

In utilizing the more comprehensive differentiation generic strategy, the organization ensures a competitive advantage via products and ingredients that generate an image of specialty and uniqueness. The design exhibits various regulations and procedures to keep the coffeehouse business differentiated from the competition. Starbucks could use the generic competitive process with its current one to maximize actual development and competitiveness (Mc Namara & Moore-Mangin 2015). For instance, the market segmentation generic strategy promotes a competitive advantage in functioning subsidiaries that complement other coffee stores. Yet, the cost of leadership might not work since the best-cost providers go against the premium brand image of Starbucks Cafés and merchandise. Starbucks expands its business via the intensive growth strategy of market penetration, market development, and even product development.

Its competitive advantage comes from its capability to innovate offerings and experiences that align with consumers' needs. Starbucks' key objectives involve its products and the expertise developed in its stores. The current C.E.O. Kevin Johnson took over in 2017 after Howard Schultz, the longtime risktaker CEO, stepped down (Starbucks Corporation, 2019). Since then, he has directed the company via several scandals, responding to a 2018 racial bias incident in a Philadelphia store by closing all stores for one day to put employees through racial bias training (Tim, 2020), which is another competitive advantage for having such as leader. Moreover, with his demonstration and the ability to devise effective means to get solutions, Johnson has proved he is fulfilling his duty as a caretaker CEO By guiding the firm through technological innovations in the Starbucks app, a partnership with Uber Eats, and expansion into China (Tim, 2020). Kevin Johnson has experience with Starbucks, and he is the right individual to help the organization achieve its desired goals. Another competitive advantage involves its human resource since workers are employed for specific roles and requirements that provide a competitive benefit to Starbucks.

The organization has its structure in divisions, and it combines geographic and brand-based divisions. For instance, the coffee chain giant's geographic divisions entail the Americas, Canada, the US, and Latin America. Also, Europe, Middle East, and Africa (EMEA), China, and Asia/Pacific (CAP) channel development, including other fragments. Similarly, the brand-based divisions of the organization entail Starbucks, Teavana, La Boulange, Evolution Fresh, Seattle's Best Coffee, and Tazo Tea brands (Taylor, 2017). Starbucks arrangement is tall, and it entails 35 senior vice presidents, 12 executive vice presidents, three presidents, and 2 group presidents.

The structure is a flatter hierarchy that is supported by learning and progressive organizations. There are fewer managerial levels but open access to the senior leaders, making the supporting staff feel secure and enhancing their performance and productivity. The flatter hierarchy permits a faster decision-making process for the firm and encourages commitment on the employees' part.

There is active coordination between various departments, which form inter-department teams for projects and the work that needs experience and expertise. The relationship between departments enhances a systematic process for developing and regulating coordination, promoting smooth operations to the easier achievement of desirable goals.

Starbucks entertains teamwork and team-developed tasks where the work needs a person's attention and scope, and the firm ensures they assign individuals responsible and job tasks. But workers at Starbucks are encouraged to be team players and work well with one another, including forming healthy relationships.

The company has a hybrid structure between centralization and decentralization. Starbucks encourages decentralization of the decision-making process in those job roles at Starbucks are created to be done with responsibility. And the workers set their targets with mutual coordination and comprehension with the supervisors. But it is also centralized in making sure the supervisors manage and approve various activities and tactics that workers select to ensure that they follow the company's strategy and values.

Starbucks has an intricate system that ensures communication between staff and other managerial levels is compelling. The communication system promotes the overall organizational structure, and permits an easy flow of data, and ensures that no administrative tasks and goals are compromised due to miscommunication.

Resource dependency theory is based on the tenet that a company, like a business firm, must involve in transactions with other stakeholders and organizations in its surroundings to gain relevant resources (Zona et al., 2018). RBV notes that an organization's resources contribute largely to them gaining a competitive advantage. For instance, Starbucks Human Resources is one of its competitive advantages over other firms since workers are employed for specific roles and requirements that provide competitive benefits to Starbucks. On the other hand, RDT asserts that organizations must create and monitor relationships with their consumers, suppliers, and other crucial personnel to gain significant resources.

Starbucks has operated for more than four decades, making it a better position to have more financial resources across the globe, enabling it to stay at the top and gain a competitive advantage over other competitors. The firm operates in more than eighty markets directly and through licensed stores. Therefore, it means Starbucks does not have a franchise structure compared to the typical beverage stores and fast-food stores. Since the organization owns more than 32,000 stores across the globe and other brands like Teavana, Seattle's Best Coffee, including Evolution Fresh. The fiscal financial reports claimed that Starbucks generates 81% of its revenue from the owned stores and 11% from the licensed stores, according to the Fiscal 2016 Annual Report (2017).

Another critical resource that has helped Starbucks gain its competitive advantage involves technological resources such as artificial intelligence, Big Data, Cloud Computing, Blockchain, and Machine learning. Technological advancements such as mobile ordering and effective machines for selecting and roasting coffee beans have enabled the organization to stay at the top. Technology allows the firm to encourage big ideas and forward-thinking solutions like the development of Mobile Order & Pay and Our Starbucks Rewards, and the Loyalty program enhances productivity and performance (Starbucks Corporation, 2019). Starbucks utilizes VRIN analysis to create competitive strategies that rely on its core strengths and resources to help it gain a competitive advantage compared to other competitors in the market.

The current CEO of Starbucks is Kevin Johnson, who is also the corporation's chief operating officer, guiding the firm's global operational business across America. He is a passionate leader who carries the legacy of Starbucks of human relation, driving the firm's core strategies for development, and being of service to more than 400,000 shareholder who wears the green apron across the world. The CEO joined the corporation in 2009, but in March 2015, he assumed the role of president and the chief operating officer leading the organization's worldwide operating businesses in all geographical locations (Starbucks Corporation, 2019). Kevin Johnson also provides practical support to Starbuck's supply chain sector, marketing, human resources, technology, and mobile, including digital platforms. Since then, he has directed the company via several scandals, responding to a 2018 racial bias incident in a Philadelphia store by closing all stores for one day to put employees through racial bias training (Tim, 2020), which is another competitive advantage for having such as leader.

The structure is a flatter hierarchy that is supported by learning and progressive organizations. There are fewer managerial levels but access to the senior leaders, making the supporting staff feel secure and enhanced. The flatter hierarchy permits a faster decision-making process for the firm and encourages commitment on the employees' part. Active coordination between various departments forms inter-department teams for projects and the work that needs experience and expertise (Business Strategy Hub, 2021). The relationship between departments enhances a systematic process for developing and regulating coordination, promoting smooth operations to the easier achievement of desirable goals. Starbucks entertains teamwork and team-developed tasks where the work needs a person's attention and scope, and the firm ensures they assign individuals responsible and job tasks.

But workers at Starbucks are encouraged to be team players and work well with one another, including forming healthy relationships. The company has a hybrid structure between centralization and decentralization. Starbucks encourages decentralization of the decision-making process in that job role at Starbucks are created to be done with responsibility. And the workers set their targets with mutual coordination and comprehension with the supervisors. But it is also centralized in making sure the supervisors manage and approve various activities and tactics that workers select to ensure that they follow the company's strategy and values. Starbucks has an intricate system that provides communication between staff and other managerial levels is compelling. The communication system promotes the overall organizational structure. It permits an easy flow of data and ensures that no administrative tasks and goals are compromised due to miscommunication.

Starbucks has a participative leadership style. With the application of this style, Starbucks engages its employees in the decision-making process and managerial decisions. Thereby permitting the leadership to regularly interact with the workers and other organizational groups to locate any conflicts for resolutions and get feedback concerning strategic tactics and functions. The style has worked effectively to the benefit of the company, for it has promoted employee motivation and enhanced organizational commitment and ownership among workers and other relevant personnel (Peterson, 2015). The leadership style is so effective for realizing the business goals and vision of the firm. The staffs feel valued since they can share their opinions, input, and feedback on any matter and feel appreciated. So that when they face a problem, it becomes easier for them to resolve it rationally.

Starbucks Corporation's coffee business has various strengths, such as its brand and reputation across the globe due to its lead in the coffee and café industry (Starbucks Corporation, 2021). Another force involves a loyal customer base that loves its products, and they provide good feedback and referrals to others. Thirdly, Starbucks had practical technological innovations since it developed a loyalty program that rewards frequent users with free drinks (Starbucks Corporation, 2021). Conversely, Starbucks has also branded itself as a reliable organization. It has developed robust regulations of social responsibility and committed itself to sustainability and utilizing the products ethically. Another strengthens involves its human resources and structure that has covered the Middle East, C.A.P., Africa, Canada, and other nations worldwide, which has helped enhance the reputation of Starbucks.

Promoting local cultures into menus and store design, specifically in international locations, could prove a risk since not every culture prefers their coffee served the way United States people do. Moreover, the corporate requires to tailor its menu to store locations more. Starbucks produces the finest products that are expensive, which makes it a challenge for the average person to afford, and it is something that Starbucks should investigate.

Recently, the C.E.O. Kevin Johnson released its latest SEC filing that stated Starbucks would shut down approximately 400 coffeehouses over the next 18months. From the report, it was evident that Starbucks closed 100 stores annually due to lease expiration and other related circumstances. From the letter, it was apparent that one of the primary reasons for the closure involves laying a foundation for a transformational phase that will inform a new store format called Starbucks Pickup. The store format "Starbucks Pickup" is designed for consumers who prefer to make orders in advance and pay via the Starbucks mobile app for pickup and delivery through Uber Eats (Starbucks Corporation, 2021). From the report, Starbucks has initiated a significant change due to its learning capacity. Such changes will ensure customers get their orders early enough and save a lot of time and energy going to the physical coffee stores.

One recommendation should be applied to the organization's vision statement. Thought Starbucks’ vision is stable, the organization fails to integrate new business operations and products in the corporate vision statement. For instance, tea, pastries, and merchandise are part of the product mix as affirmed by Starbucks’ marketing mix or 4P, which are not integrated into the company's vision statement. Therefore, Starbucks needs to enhance its organizational vision by incorporating these data concerning numerous products to make the image more accurate in representing the business. Comment by Leigh A. Ruggiero: We added this. It will be one of your recs.

Starbucks should develop its existing strategies such as market development, market penetration, and product development based on the discussions above. The corporate financial status is sound, enhancing external investments and getting the necessary resources to facilitate the primary strategy to achieve its goals and values. Market penetration to the organization involves extending its boundaries internationally and would help develop brand value and gain additional market share. The company has showcased its formula for profit, and consumer engagement has worked, and it should divert from its contemporary strategy. We cannot deny that Starbucks has a competitive advantage, especially in its quality compared to the generic coffee commodity. Yet, in terms of the convenience of the market, Starbucks should pursue substitutes that compete in crucial areas like America, Canada, and other parts of the world. Such as a pre-packaged drink. Thirdly, the organization should be compassionate of cultural diversity in their services so that one community should not feel unrecognized.

References